What every parent should know about wills

After Michael Jackson died June 25, it took a while for his will to surface. His parents, Joe and Katherine, began legal proceedings to gain permanent guardianship of his three children and to be named administrators of his estate. Talk about adding stress for an already grieving family.

Thus providing a teachable moment for the rest of us: If you have children under 18, as MJ did, you really should have a will (and someone else should know where it is).

I asked Trina Montalban, a mom who's an estate attorney at Kell, Alterman & Runstein in Portland, and Bob Kabacy, a partner at the firm and manager of its estate planning and business department, to weigh in on the subject.

If you die intestate in Oregon: "Intestate" is the legal term for not having a will. If that's the case, there are laws to address the situation.

"If the wife passes and there's a husband, then guardianship is automatic to the husband," Montalban said. "The real question becomes, what if both of you die and you haven't appointed anybody?"

Under state law -- Oregon Revised Statutes, Chapter 125 -- biological parents get first dibs, followed by non-biological parents. After that, the court will consider people who have submitted petitions for guardianship. The guiding theme is "trying to have the least impact to the child and to the lifestyle of the child," said Kabacy. "The court's job is to make a determination of what's in the best interests of the children."

If a guardianship case gets to the point where the court has to pick a guardian from among several possibilities, the court will interview each person, ask the children about their preferences and possibly get reports from physicians and/or psychologists.

Kabacy said he's seen one case in which a non-relative was appointed as a child's guardian. "The biological parent had a substance abuse issue and was not fit to serve as a parent; the biological parent didn't even dispute it," he said. "Also, sometimes biological parents can't be found when you have broken marriage situations or children from non-marriage."

When to write a will: Once you have a child, Montalban said, "it becomes incumbent upon you to say who the guardian will be." In other words, do it as soon as you can.

Kabacy added, "Most people want to take care of their spouse and children naturally, and they don't necessarily want assets passing to family they don't know," which can happen without a will. He stressed the importance of making sure that spouses are provided for -- for example, children from a first marriage might get priority in inheritance over a spouse from a subsequent marriage -- and that children are provided for in the manner that you would want.

What a will should cover: Guardianship and distribution of assets -- in the case of children who are not yet financially independent, what Kabacy called "protecting them against themselves." Let's take a look at each of these.

Choosing a guardian: Among my friends, this has been a big concern, especially because many of today's families and friends are scattered across great distances.

Here, the court can be a parent's ally. That's because the guardian you name in your will is not officially the guardian until the court approves him or her. "In 99 percent of the cases, the court is going to follow the wishes in the will," Kabacy said. "But the court is also going to test whether the person who is nominated is qualified and capable at the time they are being asked to act as guardian."

Distributing assets: A parent's estate should go primarily toward raising the children, Montalban said. If there is money left over after educational, medical and other expenses, she said, parents often will delay or limit distribution of the inheritance. "I've seen it where some people don't give money until the child is 35," she said. "Once we get older, we realize how irresponsible kids can be, so you don't want to give them this lump payment at 21."

Kabacy added that it's important for parents to clarify their values for their children: "Those values will really dictate the language of the document," he said. In other words, if it's important to you that your child continue his education through college and beyond, for example, or that she fulfill her dream of volunteering for the Peace Corps without worrying about the cost, you can set up your will to ensure funding for those scenarios.

When to update a will: Parents are sometimes told that they don't need to update a will just to add the name of a second or third child, as wills can be written to say "John Jones Jr. and all subsequent children." Kabacy said that technically, that's correct, but then you run the risk of creating ambiguity in a legal document. "Our recommendation is that when you have a child, you celebrate that event and include them by name in the will, out of respect and equal footing," he said.

Health directives: Oregon has an advance directive form, which Kabacy noted parents can use to stipulate whether they want tube feeding, whether they wish to be placed on life support and more. "By making your wishes clear, you avoid a Terri Schiavo situation," he says, referring to the woman caught between the differing desires of her parents and her husband while she lay comatose.

Kabacy added that parents should consider this legal wrinkle: If you have a child older than 18 who becomes unable to make medical decisions or release medical records, the federal privacy law known as HIPAA can shut out parents. "It's a sad situation if a parent shows up at the hospital asking to find out if their child is in there after a car accident, and the hospital turns them away," Kabacy said. He recommends that parents consider getting a HIPAA waiver, a power of attorney and/or an advance directive for an adult child if the child doesn't already have those documents. (HIPAA does not apply if your child is a minor.)

Parting thoughts: Kabacy left us with this analogy: You wouldn't run a business without a business plan. But many families never bother to sit down and discuss, much less put in writing, their family plan, goals and values. "Spending a few minutes addressing those issues and then getting the legal paperwork to support those decisions and those values is something that's really important to avoid expense and ambiguity," he said.